Local petroleum players remain cautious of the cost of their operations as geopolitical tensions, particularly in the Middle East, and price swings continue to unsettle global fuel markets.
Leo Bellas, president of Jetti Petroleum Inc., said on Tuesday that while global crude prices have softened—based on Monday’s Mean of Platts Singapore (MOPS) indicators—a hike in domestic pump prices is still projected for next week.
“If we base it solely on Monday’s MOPS prices, gasoline may increase by P1.45 to P1.65 per liter, while diesel could go up by P0.75 to P0.95,” Bellas said.
He explained that despite a drop in international trading on June 23 — diesel down by over $3 per barrel and gasoline by more than $0.50 per barrel — prices remain elevated. “If these levels hold for the rest of the week, local pump prices will likely rise,” he said.
Bellas added that market concerns have slightly eased following Iran’s retaliatory strikes on US bases in Qatar — diverting attention from earlier fears of a closure of the Strait of Hormuz, a critical energy chokepoint that handles roughly 20 percent of the world’s oil flows, according to the Department of Energy (DOE).
“With MOPS showing a steep decline on June 24, next week’s projected price hikes may be pared down or even turn negative if the trend continues,” Bellas said. “But it’s still too early to call.”
DOE Officer-in-Charge Sharon Garin said the Philippines may temporarily look to non-Middle East suppliers for its petroleum needs. But Bellas emphasized that for crude oil, the Middle East remains the most viable source for the country’s lone refinery.
“Alternative sources exist, but freight costs are significantly higher. Plus, crude quality varies, and not all grades are compatible with our refinery,” he explained. Petron Corp. operates the Philippines’ only crude oil refinery in Bataan, with a capacity of 180,000 barrels per day.
For refined products, Bellas said the Philippines sources from various Asian refineries—some of which use crude from the US, Canada, Russia, and India. “Imports from North America are possible, but logistics costs are a major hurdle,” he added.
Clean Fuel executive and former Independent Philippine Petroleum Companies Association (IPPCA) president Jesus Suntay said local players also grapple with domestic cost pressures.
“Excise taxes, biofuel blending mandates, and high delivery costs—made worse by road weight limits—push pump prices up,” Suntay said.
He praised oil industry deregulation for encouraging competition. “More retail stations led to natural price competition. Everyone wants prices lower—when fuel is cheaper, motorists buy more.”
Suntay also said the impact of any global supply de-escalation would reflect on trading prices within three business days, reinforcing the current “wait-and-see” posture among players.
As of June 23, DOE data showed average per-liter prices at P55.90 for gasoline, P53.40 for diesel, and P70.22 for kerosene. DOE Oil Industry Management Bureau Director Rodela Romero said June 24 prices were not yet available, as full monitoring begins midweek.
To cushion consumers from soaring global oil costs, local fuel retailers have agreed to stagger price hikes this week. The first round — implemented Tuesday — increased prices by P1.75 per liter for gasoline, P2.60 for diesel, and P2.40 for kerosene. A second round is set for Thursday, June 26.
